📉 FaZe Clan stock fell below $1 six months after a $725M debut

Pitched near a $1B valuation, priced at $725M, then under $1 a share within six months: a Nasdaq delisting notice and a fired CEO. 📌

By , creators desk · Desk editor Gustavs Ērkšķis-Kreicbergs · · 3 min read

Two game controllers glowing in a dark room (stock photo)SUB-$1Photo: Furkan Salihoğlu · Pexels License

Stock photo: Furkan Salihoğlu, Pexels License, via Pexels. Desaturated and cropped by MrScandal.

What we know

  • FaZe Clan's SPAC merger with B. Riley Principal was pitched at close to a $1 billion valuation; the company went public on Nasdaq on July 20, 2022, at a lower $725 million valuation.
  • FaZe Clan's stock fell below $1 for the first time on January 20, 2023, and was trading at $0.76 by February 15, 2023.
  • In March 2023, Nasdaq issued a delisting notice giving FaZe Clan 180 days to get its share price back above $1.
  • FaZe Clan cut 20% of its staff in February 2023 and reported about $14 million in losses for the first two quarters of 2023.
  • CEO Lee Trink was fired on September 11, 2023, and replaced on an interim basis by COO and CFO Christoph Pachler.

FaZe Clan's trip onto Nasdaq was supposed to turn esports' most online brand into a billion-dollar public company. The SPAC merger with investment firm B. Riley Principal was announced in October 2021 with an expected initial valuation around $1 billion, GamesIndustry.biz reported. By the time the deal closed on July 20, 2022, the number had shrunk to $725 million. That gap is where this one starts.

The timeline

01

The debut comes in under the pitch

FaZe Clan went public on Nasdaq on July 20, 2022, as part of a SPAC merger that had been expected to value the company at around $1 billion. The deal closed at $725 million instead, The Verge reported. FaZe had been set to receive approximately $291 million from B. Riley Principal through the merger.

See the receipt (opens in a new tab)
02

Shares drop below $1

On January 20, 2023, FaZe Clan's stock price fell below $1 for the first time, putting the company at risk of delisting from Nasdaq, Kotaku reported. By mid-February 2023, shares were trading at $0.76.

See the receipt (opens in a new tab)

By the numbers

  • 4y 4mfrom first to latest entry on recordMay 2019 to Sep 2023, 7 dated entries in the file
  • 7receipts behind this story6 news reports, 1 public record, 2021 to 2023

Counted by MrScandal from the receipts, the Files and our rankings.

03

Nasdaq sends a delisting notice

In March 2023, FaZe Clan received a notice of delisting from Nasdaq, giving the company 180 days to raise its stock price back above $1. In a filing, the company said it "may, if appropriate, consider implementing available options to regain compliance."

See the receipt (opens in a new tab)
04

Layoffs, losses, and a board exit

FaZe Clan laid off 20% of its staff in February 2023, which Trink attributed to economic uncertainty, Esports.net reported. The company reported roughly $14 million in losses across the first two quarters of 2023, with slightly decreased revenues, Esports Insider reported. In April 2023, Snoop Dogg departed from the company's board.

See the receipt (opens in a new tab)
05

The CEO is fired

FaZe Clan terminated Lee Trink as CEO, effective immediately, on September 11, 2023, Esports Insider reported. Christoph Pachler, the company's COO and CFO, was named interim CEO.

See the receipt (opens in a new tab)

"the voice of youth culture"

Lee Trink, FaZe Clan CEO, on the 2021 SPAC merger (GamesIndustry.biz)

A clan that started as teenagers trickshotting in Call of Duty got branded, by its own merger paperwork, as the voice of a generation - which is a lot of marketing weight for a stock that spent part of 2023 trading for less than a bag of chips.

What is on the record is the arithmetic: a roughly $1 billion pitch, a $725 million debut, a stock below $1 within six months, a Nasdaq delisting notice, layoffs, and a fired CEO. For a brand that sold itself as the voice of youth culture, the market returned a blunt second opinion.

Earlier on file: Tfue sued FaZe Clan, says it took up to 80% of his brand pay

The FaZe Clan file

Last entry Sep 2023
  1. Reported

    FaZe Clan terminated CEO Lee Trink effective immediately, Esports Insider reported. This story

  2. Filed

    Nasdaq issued FaZe Clan a delisting notice, giving it 180 days to raise its share price above $1, Hypebeast reported. This story

  3. Reported

    FaZe Clan laid off 20% of its staff amid financial uncertainty, Esports.net reported. This story

  4. Reported

    FaZe Clan's stock fell below $1 a share for the first time, Kotaku reported. This story

  5. Ruled

    SEC declared effective FaZe Clan's SPAC merger registration, clearing the way to its Nasdaq debut. This story

  6. Filed

    FaZe Clan sued Tenney in New York, accusing him of disparaging the company and trying to form a rival esports group, The Verge reported. Tfue sued FaZe Clan, says it took up to 80% of his brand pay

  7. Reported

    FaZe Clan said on Twitter it had collected $60,000 from Tenney's branded deals and offered him a contract with zero percent to FaZe Clan. Tfue sued FaZe Clan, says it took up to 80% of his brand pay

On file: The FaZe Clan file

The Ledger

On the record

  • FaZe Clan's SPAC merger closed at a $725 million valuation on July 20, 2022, below the roughly $1 billion originally pitched.
  • The stock fell below $1 on January 20, 2023, Nasdaq issued a delisting notice in March 2023, and CEO Lee Trink was fired on September 11, 2023.

Still rumour

    That's the record. The rest is rumour. - MrViral

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